Comments on popular sectors and individual stocks

The preliminary debt restructuring plan was disclosed before the Huaxia happiness Festival. The biggest uncertainty of Ping An's asset side fell to the ground. Ping An, the leading sector, continued to open higher after rising more than 4% at the opening, and rose nearly 8% at the closing. Other insurance stocks also rebounded significantly driven by Ping An. China Pacific Insurance, China Life Insurance and Xinhua insurance rose by more than 5%. Shenwan Hongyuan Securities said that there are two ways to consider the observation on the sustainability of insurance stocks: 1) since August, the risks of some real estate enterprises have continued to ferment, the valuation of insurance enterprises has been significantly under pressure, and the A-share real estate sector has warmed up in September. We believe that the adjustment since August can be effectively repaired (space 15% - 20%); 2) From the perspective of valuation premium, Ping An's valuation premium compared with other listed insurance companies is only 5%, compared with 25% - 30% most of the time before. In addition, China Ping An has a long-term poor expectation. China Ping An is already one of China's largest technology companies. The algorithm for the future insurance industry may no longer be the "law of large numbers" for the risk probability of a group of people, but use big data to enter the era of "thousands of people and thousands of prices". As musk recently said on twitter, Tesla plans to launch its own auto insurance business in October and officially enter the insurance industry. Its UBI auto insurance indicates a major change in the insurance industry. With the help of big data, it can solve a big problem in the insurance industry, that is, the problem of information asymmetry with customers, which may benefit the insurance industry for a long time.